CNOOC 0883

[winston]

Not vested

Cnooc Tumbles in Hong Kong After Forecasting Lower Oil Production in 2011

Cnooc Ltd., China’s biggest offshore energy explorer, fell the most in eight months in Hong Kong trading after forecasting production growth will slow this year.

Cnooc said yesterday it plans to increase oil and gas production by 12 percent to as much as 365 million barrels of oil equivalent in 2011. Output rose about 44 percent last year, boosting the company’s shares by 51 percent.

“Output growth will slow to a normal level this year and the coming five years after the rapid increase last year,” Bernard Chu, an analyst at Guodu Securities HK Ltd., said by telephone. “Today’s share plunge, we consider it as profit- taking after the stock surged last year.”

The shares of Cnooc outpaced the 5.3 percent gain in the Hang Seng Index last year. The oil and gas producer is rated a “buy” by 19 of 30 analysts surveyed by Bloomberg. Six rate Cnooc a “sell,” while five recommend holding the stock.

The Beijing-based company may report profit rose 75 percent to 51.5 billion yuan ($7.8 billion) last year, the mean estimate of 15 analysts surveyed by Bloomberg shows. Net income may increase to 58.6 billion yuan this year, according to them.

‘Profits Ahead’

“With oil likely to average $100 this year versus $80 last year, Cnooc’s latest production growth guidance could translate to more record profits ahead,” said Gordon Kwan, the head of regional energy research at Mirae Asset Securities Ltd.

“While some might view Cnooc’s growth target as a big ‘slowdown,’ don’t forget this is on top of a very high base in 2010 that saw over 44 percent jump in oil and gas output. Many global peers out there can only manage low single-digit production growth.”

Capital spending may rise 55 percent this year to $8.77 billion as Cnooc steps up deepwater exploration in areas including the South China Sea, the unit of state-controlled China National Offshore Oil Corp. said yesterday. Cnooc plans to start up four projects off the Chinese coast in 2011.

http://www.bloomberg.com/news/2011-01-2 ... -2011.html

[winston]

Not vested. And I was wondering why it collapsed today ..

Friday Morning Short-Selling at 10.4m shares

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MARKET TALK: CNOOC Dn 5.7%; Runner-Up In Short Selling

Source: Dow Jones Newswire

[winston]

Not vested

DJ MARKET TALK: Cnooc Down 6.4%; BOA-ML Cuts To Neutral Vs Buy

1514 [Dow Jones] Cnooc (0883.HK) extends its losses, now down 6.4% at HK$17.44; volume is hefty at HK$2.11 billion, making the stock the most heavily traded in HK, suggesting heavy selling pressure.

Technically the stock convincingly breached its 50-day moving average at HK$18.21, indicating that shares are likely to turn bearish in the medium-term.

Bank of America - Merrill Lynch downgrades Cnooc to Neutral from Buy despite slightly raising its target to HK$19.00 (from HK$18.20), due to slower organic growth in 2011 and possibly in 2012, as well as the recent strong share-price performance.

'We believe investors might have been too excited about Cnooc's growth profile over the last 12 months, leading to a 55% outperformance to HSI,' the house says.

Source: Dow Jones Newswire

[winston]

Oil up > US$4 but this counter dropped 2%.

Do you understand ? I dont so I'm not vested

[winston]

Not vested


DJ MARKET TALK: Cnooc Down 1.7%; US$570 Mln Deal With Chesapeake

1047 [Dow Jones] Cnooc (0883.HK) is down 1.7% at HK$17.02, adding to Friday's 7.0% decline due to the company's lower-than-expected guidance for production growth of 8.0%-12% in 2011.

Still, while investors are lamenting on anemic organic growth, Cnooc is aggressively expanding overseas; the latest being news that it's buying into several shale oil and gas leases in the U.S. owned by Chesapeake Energy (CHK) for US$570 million in cash, the latest move by a Chinese oil company to learn a technology that is revolutionizing the U.S. gas industry.

Based on the latest Thomson Reuters consensus, Cnooc is trading at 10.6X this year's forecast earnings, further downside from here appears likely to be limited; its intraday low of HK$16.90 may act as an immediate support. Cnooc is again the most heavily traded HK stock with HK$862.8 million.


Source: Dow Jones Newswire

[winston]

Not vested

DJ MARKET TALK: Cnooc Down 2.6%; Buy At Around HK$16 - Prudential

1211 [Dow Jones] Upstream oil play Cnooc (0883.HK) is down 2.6% at HK$16.46, extending its 4.9% fall over the past two sessions due to continued crude oil price weakness; March crude futures settled down 0.6% at US$86.94/bbl on Nymex Tuesday, as fears of supply disruptions at the Suez Canal eased.

"Recent weakness in the crude oil prices has triggered some profit-taking in Cnooc (the stock rose 48.2% over the past 52 weeks), but I think it would be attractive to buy the stock at around HK$16.00," says Prudential Brokerage's associate director Alvin Cheung. The stock last traded below HK$16.00 on Oct. 29.

Source: Dow Jones Newswire

[winston]

Not vested

DJ MARKET TALK: Cnooc Down 2.7%; Crude Price Weakness Weighs -WFF

1533 [Dow Jones] Cnooc (0883.HK) is down 2.7% at HK$16.44, after coming off of its early trough of HK$16.24, which is its lowest level since Oct. 29, 2010.

Mark To, head of research of Wing Fung Financial says recent weakness in crude oil prices has been negative for Cnooc, as it mainly focuses on upstream oil operations.

Cnooc fell 4.9% over the past two sessions due to continued crude oil price weakness, with March crude futures settled down 0.6% at US$86.94/bbl on Nymex Tuesday, as fears of supply disruptions at the Suez Canal eased.

"Investors are taking the opportunity to take profit of Cnooc (the stock rose 48.2% over the past 52 weeks)." He says the 50-day moving average of HK$14.67 is unlikely to be troubled.

Source: Dow Jones Newswire

[winston]

Not vested

DJ MARKET TALK:Cnooc Falls 4th Straight But May Not Slide Further

1200 [Dow Jones] Cnooc (0883.HK) is falling for the fourth straight session although it appears to be stabilizing; the stock is down 0.2% at HK$16.38 with volume moderating to HK$541.4 million.

Cnooc started its recent downtrend on Jan. 28 when the stock tumbled 7.0% following its below-view production guidance for 2011. Valuation-wise further downside from here would appear to be limited, with the stock trading at 10.2X consensus FY11 earnings based on Thomson Reuters.

UBS removes Cnooc from the house's Least Preferred list following the large share-price decline, as "we have less conviction on the potential for the stock to underperform."

Source: Dow Jones Newswire

[winston]

Not vested. From UOBKH:-

Valuation/Recommendation

Accumulate on share price weakness.

Given the strong oil prices as well CNOOC’s solid fundamentals, we believe the recent share price pullback created good re-entry opportunities for long-term investors.

Right now the stock is trading at very cheap 7.8x 2012F PE, significantly below the average 14x PE for global independent oil producers.

We maintain our target price of HK$25.00, representing 12x 2012F PE, on a par with its average PE since 2003.

http://research.uobkayhian.com/research ... 818613.pdf

[winston]

Not vested. From Phillips:-

Valuation:

We raise our 12 month target price to HK$20.05, based on 2011e p/e of 12.05x. We remain positive towards CNOOC due to its earning growth, strong balance sheet, and its ability to enjoy a high oil price environment.

Our analysis is based on the assumption that WTI will average at US$85/bbl in 2011, and the Company will have a CAGR of 9.0% in the following 5-years. The Company is currently trading at approximately its 4-years average forward p/e, 11.5x.

Short term speaking, the 2010 financial results releasing in March could be a one time catalyst if it comes better than expected. Reserves booking are of focus in the annual result, and a boost in reserve years could fuel the stock price.


2011 Operation Targets:

Exploration. CNOOC will be focusing on the deepwater exploration. Two to three independent deepwater wells and three PSC are planned for this year. Deepwater exploration in the Yunkai area, Baiyun East-Xingning area, and Liwan Trough will be the main driver for mid to long-term growth. 4 new projects are scheduled to come on stream, while 15 projects are currently under construction.

Cost control appears to be a new challenge. While the year 2010 experienced a cost `deflation` relative to 2008 and 2009's level, capital costs are expected to peak this year mainly due to four reasons: oil price, steel, labor and service.

Significant projects. Among the four new projects in offshore China, Jinzhou 25-1 and Jinxian 1-1 are scheduled to come on stream in the 1H11 while Weizhou 11-2 and Lufeng 13-2 adjustment are scheduled in the second half of 2011.

Both the module and jackets offshore installation have completed for the Jinxian 1-1 project. Peak production is expected to reach 21kb/d. Jinzhou 25-1 is a major light crude field, with an expected peak production of 14kb/d


Risks:
1. Industry costs under pressure and China's raising labor costs
2. Lower than expected oil and gas prices
3. RMB fluctuation